ABSTRACT
We need to use the right inventory method for today’s business competition. This research empirically aims at examining the factors influencing the inventory method of the trading and manufacturing companies listed on the Indonesian Stock Exchange. A purposive sampling method was employed in this research with the research population of companies listed on the Indonesian Stock Exchange during the period of 2012–2017: 234 samples were obtained and then analyzed using a logistic regression analytical method. The research results show that company size and supply variability have a significant effect on inventory method selection, while ownership structure and current ratio do not have a significant effect on inventory method selection. The Nagelkerke R square testing result is 29.5%, meaning that those four independent variables explained only 29.5% of the dependent variable, while the other excluded variables explained the remaining 70.5%.
